Raise exposure to cash, 5-year notes: HSBC

The continuing problems in Greece have prompted analysts at HSBC bank to tweak their asset allocation recommendations.

“… even if the likelihood of an immediate Greek restructuring is small, the potential scale of the contagion effects is enough to cut risk further,” wrote Fredrik Nerbrand, global head of asset allocation at HSBC.

“…would be more than just a normal risk-off event in the sense that it would spark profound sovereign default fears. A default is wealth destructive and could be the start of a ‘debt forgiveness’ trend, which would take years to unravel.”

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